>> Narrator: Live from Washington, DC, it's The Cube covering .NEXT conference brought to you by Nutanix. >> We're back at Nutanix .NEXT. This is The Cube, the leader in live tech coverage. We go out to the events and extract the signal from the noise. My name is Dave Vellante and I'm here with my longtime co-host Stu Miniman. Don Mims is here as the director of infrastructure and virtualization at Baylor, Scott, & White Health. Don, great to see you. Thanks for comin' on The Cube. >> Thanks for havin' me. I appreciate it bein' here, it's very nice. >> Yeah, so Baylor, Scott, & White Health, we weren't familiar with that before we met you. Tell us a little bit about the organization. >> Sure. So, Baylor, Scott & White Health is based in Dallas, Texas. We've recently had, over the last couple of years, a merger opportunity. We merged with Scott & White that is down in Temple, Texas which is a little farther east, or west and south of Dallas. And we've grown our organization to around 40 hospitals, over 500 clinics and we continue to grow and make strives in the healthcare space. >> Dallas is booming. I mean, obviously-- >> It is. World-class city with world-class healthcare. Talk about some of the things that are happening in healthcare that are sort of driving your strategy, the challenges that you guys are having. I mean, obviously, there's, there's EMR, there's meaningful use, there's, you know, changes in the Affordable Care Act, all that stuff. That and or other things that are really driving strategy and creating challenges for you. >> Yeah, one of the biggest things that we're doin' right now is movin' into the digital space. So, the patient, centered focus being in a traditional brick and mortar facility, is shifting. Patients wants quicker access to data, quicker access to physicians. So, bein' able to create solutions that can deliver a physician and patient experience, possibly from a mobile device, a phone, a tablet, a PC, is where we're movin' the market towards. So, some of the solutions that we're building and delivering are enabling a faster delivery of technology for healthcare. >> You know, sort of, when you think about last decade, docs were, sort of, averse, somewhat to technology. >> You're right. >> And mobile really changed that, hasn't it? >> It has. >> How has that affected your, the backend infrastructures? >> So, it definitely has to be more robust. As you're delivering content now, video, web chats, things like that that have to be reliable because now patient outcomes depend on that type of data delivery, the backend has to be available more than ever at this time. >> So it's kind, you actually kind of have an IOT use case in the hospitals, right? >> We're gettin' there. >> And then when you start pushin' video around it's got to be very challenging. Now you're also doing some projects around DNA sequencing. Is that right? >> We are. It's very exciting space. We recently delivered a solution on Nutanix to create a DNA sequencing platform that hasn't been done before as we know it. The vendor, this was the first time for the vendor, a first time for Baylor, and it has been very successful implantation and it's, it's a very robust system today. >> Don, can you bring us inside a little bit? What were the requirements you were lookin' for? What led you down the path to Nutanix? Had you been usin' them before or was this the first-use case? >> It's actually not the first-use case. The project actually started out as a, it was a migration. The customer was using a hosted solution. It was slow. Their sequencing data was taking a long time. Their results were being held up because of the way their architecture was set up. So, we decided to bring it in-house and put it on a platform that was kind of new to us and try to deliver it with better speed and it definitely has done that. >> And does that trickle down to, you know, what does that mean to the cost of solutions? I mean, I think we all know it, you know, DNA sequencing used to take a long time and a lot of money and it's now, you know, kind of, do a swab type things and it's done a lot less. >> Yeah, so with this platform, the customer, the physician is now not only going to use this platform to get results quicker, we're also going to start potentially offering this as a service to others and help other physicians and other clinics also get their results quicker as well. So, it's going to grow over time to just an in-house solution to maybe something more broad-scale. >> So you saw the keynotes this morning. They're pushin' a lot of information at us. Obviously, we, Stew and I talked about it in our open. Nutanix, a couple years ago, sort of pivoted beyond hyper-coverged infrastructure, tryin' to position as cloud even though they still a lot of hyper-converged infrastructure, let's face it. But, as a consumer, as a practitioner, how does that message relate to you? You have a lot of vendors tryin' to sell to you. You got cloud, different cloud strategies, cloud, cloud, cloud, cloud, cloud. Dev-ops, containters. So, do you, what do you want to see from a company like Nutanix? Do you want them to, like, stick to their knitting, hey just give me hyper-converged infrastructure, or do you want them to take you on, on a journey? I wonder if you could add some color to that. >> Sure, and where you're goin' with that question is exactly the reason we chose this solution because it's way bigger than just a hyper-converge, you know, solution. That was, for me, that was kind of the first thing. That's what got us hooked and then the innovation that's come, you know, since then, and things that we've learned about the product and where they're goin' with automation, migration strategies of current workloads, the ease of management, the cloud strategy, the partnerships that they're makin' now with other, with other partners. That's really what I like to see and that continued growth is why we chose this product 'cause they have that vision and it's really appealing. >> And so, do you, are you using public cloud today? >> We are in a very limited manner. As you can imagine, health care and personal health information in the cloud can be kind of scary to some people so we have started that roadmap and we continue to try to expand that as we go. >> Is it fair to say that as an infrastructure professional that you're, you're, can I summarize your infrastructure strategy is you want, like, to, substantially mimic the attributes of a public cloud where it makes sense on prem. Is that fair? >> That's exactly what we're tryin' to do. Speed to delivery, server provisioning, resiliency of the infrastructure, invisible infrastructure, you might have heard that term today or over the past few days. That's what we're tryin' to accomplish. >> Self-service or no? >> Self-service internally right now. So, my own staff are going to use the automation internally to deliver quicker and then eventually as we perfect that, we'll let our customers self-service. >> So be as cloud-like as possible but not too cloud-like too soon? >> Exactly. >> So do you feel as though, as an IT pro, that you are on the path to achieving that vision? >> I do. We are, at Baylor, we're breaking new grounds with what we've done recently and I think the longterm vision to where we want to be is going to be, is going to be big over the next few years. >> So we get, we get into a lot of discussions with folks in our community that are, you know, kind of, cloud bigots, I'll call them and they say, "Hey, the vendors like Nutanix "and even more so vendors like IBM and HPE "and, you know, EMC, and their customers "will never be able to achieve what Amazon achieves." My question to you is, and you probably agree with that, I mean, Amazon's ahead of you, I bet. But, I would hope. But, how do you feel about that? Is that okay? Do you lose sleep over that or do you feel as though, "Hey, we've made so much progress." I wonder if you could comment on that as an IT pro. >> Yeah, sure. So, briefly on that topic, Amazon's business model is a little different than the industry that we're in, right? >> Yeah, sure. >> And, we're not really in the technology delivery business, right? We're in healthcare and patient servicing but what we do behind the scenes to enable the patient satisfaction and patient outcomes using this web-scale technology or this Amazon-like infrastructure is something that we're going to continue to build and grow on. We'll never be in that position, like Amazon is. But behind the scenes with automation and the infrastructure resiliency, using that same technology is what we're going to, how we're going to accomplish that. >> So a big part of that, 'cause you mentioned some of the digital transformation you're doin' up front, a big part of that cloud-like on prem, is makin' your people more productive and not, you know, focused on provisioning LUNs and servers and-- >> That's right. >> You know, pluggin' in cables. It's really automating as much as possible. So, have you seen the affect on non-differentiated IT labor in your shop? >> We have. So, just within our team, the amount of time the engineers have to spend on just this specific infrastructure has been greatly reduced so we get to spend more time doin' things like protectin' our environment. You know, a lot of these, these viruses have been comin' out lately. These, these exploits. So, we've been able to patch more diligently, remediate issues, and then we've seen other reduction in time for other teams. Storage team, they don't have to deal with our stuff anymore. They can focus in other areas. So it's really been a shift in the way we do business. >> So just one more followup, I know that Stu wants to jump in. So, and this is a hard question to be precise on, but, in rough terms, if you think in, you know, rough percentage terms, how much, you know, sort of, of the labor effort you've been able to shift to more interesting, the fun stuff, as Stu calls it. Is it a 5% factor or a 20%, 50%, you know, 100% factor? I wonder if you could just give us some anecdotal-- >> Right now the impact has been pretty small. If you look at the, our Nutanix infrastructure today, it's a very small portion of our overall infrastructure since it's fairly new. >> Right. >> But, I can tell you, the time that we spend on that right now is very minimal. I have one engineer that oversees the entire infrastructure at this point. I'm freein' up multiple other resources to do other things, so it's been an improvement. >> And so, and so pre-, pre-hyper-converged, if you didn't go that direction you'd have more than one engineer or? >> Oh, I'd have, I'd probably have at least three times as many. >> So three x factor, wow. >> Just because there's so many other components that you have to manage that aren't just specific to that one stack. >> David: Mhm, right. >> Don, you've got virtualization in your title, how do you look at virtualization today? Where are you in that journey? We've been hearin' at a lot of these shows that we've been at that, you know, virtualization feels like it's played out for the most part. We know where it is. Cloud has been the big discussion. Where is it in your job? >> So, kind of two paths in my infrastructure. We have server virtualization which is traditional, you know, virtualizing the compute workload. And then also on application virtualization, so app delivery. And I think there's still a lot of room for growth in both of those aspects. Application delivery is going to continue to morph and it can be delivered from multiple different platforms and I can see it doin' that over time. Server virtualization is a way to go and what we're doin' there is tryin' to continue to deliver the capacity, you know, that we're at or continue to grow it but at the same time shrinking that hardware footprint and relieving some of the stress in the data center and that's what we're lookin' for. >> On server virtualization what are you usin' today? >> For server virtualization we use VM ware, ESX. >> And have you looked at the HV stuff at all? >> We have and I'm very excited about that and it's kind of one of those things where you can't jump in with two feet right off the bat just because it is a little new and you feel like you need to really look at it really closely but at the same time, I'm pretty confident that it's going to be a good, longterm replacement as we continue to look at it. >> One of the, Nutanix has really been looking out for their future plans. One, share, you know, what resonates with you, and what about yourself? What kind of future strategy do you have? What are you looking for from the vendor community to help you do even more with your resources? >> So, the vendor community definitely, this is kind of a new area for them. A lot of the application vendors we talked to aren't really familiar with this platform so I think as this product grows and as this space grows, I think more vendor awareness is going to come about and they're going to be more comfortable with this as a solution. >> Okay, yeah, especially healthcare. It's all those ISVs that need to integrate and support and say, "Yes, I'm okay with it." >> Exactly. >> We saw that with virtualization at first and... >> Yup. And health care is always traditionally a little bit behind 'cause it's a little more conservative space. So, I think it'll take a little bit of time for them to feel comfortable there, as well. >> So what are the big problems you're tryin' to solve today from an infrastructure standpoint? >> Well, you know, financial issues are always a topic, right? So, what we're tryin' to do is deliver infrastructure to support our patients in a cost-effective way. So bein' as frugal with the money that we do have and buyin' the right technology and not spendin' a lot of money on a diverse stack and wasting financials. >> I mean, you just basically, you know, reduced your IT labor in that little part of the world by, you know, a factor of, you know, 3x as we talked about. Is there a gain-sharing philosophy where some of that reduction comes back to you for innovation or is it just, sort of, go back to other parts of the hospital? >> It will go back, probably, just to the bigger, to the bigger team. I mean, there are benefits to us, you know, specifically that we're going to achieve, but overall, that time-saving goes back and allows, you know, different teams to do other things which overall will help improve our whole environment. >> So in the keynotes today, and I was talking to you off-camera about one-click migration, there was a database migration and, I think it was one-click DR as well, but I'm interested in the database stuff. You've got some experience with databases. Actually, let me ask you, is that part of the infrastructure definition is database on down? >> It is. >> Yeah, okay. So what was your reaction to the sort of one-click database migration? >> It's very exciting. I think that's going to help in the aspect of migrating workloads from, from Legacy or traditional to this new platform. There's, I think there's still some components that you have to consider. The migration is very nice but, you know, validation, testing, all those kind of components also have to be part of that whole plan. >> So if I looked at the, I mean, database migrations can sometimes be real hard balls. So if I, if I look at the cycle, you know, the anatomy of a migration, let's say it takes, you know, n amount of time, what is that amount of time, you know, on average, and I know it's a hard, it's one of those stupid average questions. >> It can vary based on size. >> Yeah, I know it's a big it depends. But what percent of that, that, that value chain, if you will, that sequence chain is Nutanix attacking with what you saw today in your view? >> So, what you do is reduce the execution part of that migration and you probably reduce a lot of the planning phase of that because in any kind of a database migration, there are so many factors that go into that and a lot of the discussion is around how are we going to move this workload to this new space? And Nutanix has solved that by taking care of the how and then, you know, you just need to figure out how you're going to validate, test it, and confirm that once it's there, everything continues to work as expected. So I think you've reduced the time of planning and execution both with that strategy. >> I mean, the planning piece has actually got to be a huge portion-- >> Huge. >> Is it half of the total? >> It's probably at least half. >> Yeah, I would think so. >> Because the better you plan, the better you're going to execute, right, so. >> Yeah, yeah, right, right. Okay, good. Well, Don, I'll give you a last word on futures. What kinds of things are you workin' on that, you know, you can share with us? >> So for us, the future is going to be to, to continue to converge this stack. We're going to continue to move forward with automation. Try to reduce the delivery time for applications and servers and infrastructure and eventually simplify our management layer and spend more time doin' other things, doin' more fun stuff. And that's what we're lookin' to do. >> Love it. As I always say, love havin' the practitioners on we get to pepper questions and get the real story. So Don, thanks very much for comin' on The Cube. >> Thank you for havin' me, I appreciate it. >> You're very welcome. Alright, keep it right there everybody. Stu and I will be back with our next guest right after this short break.

>> Announcer: Live from San Fransisco It's theCUBE Covering PURE Accelerate 2017. Brought to you by PURESTORAGE. >> Welcome back to PURE Accelerate. This is theCUBE, the leader in live tech coverage. I'm Dave Vellante with my co-host Stu Miniman. This is PURE Accelerate. We're here at Pier 70. Brian McDaniel is here he's an infrastructure architect at the Baylor College of Medicine, not to be confused with Baylor University in Waco Texas, anymore. Brian Welcome to theCUBE. >> Thanks for having me appreciate it. >> You're very welcome. Tell us about the Baylor College of Medicine. >> So, Baylor College of Medicine is a, first and foremost, a teaching facility but also the leader in research and development for healthcare in the Texas Medical Center in Houston Texas. We currently employ roughly 1,500 physicians and so they occupy a multitude of institutions, not only at Baylor but other facilities and hospitals in and around the Texas Medical Center. >> So, it's kind of' healthcare morning here Stu. We've been talking about electronic medical records, meaningful use, the Affordable Care Act, potential changes there, HIPAA, saving lives. These are big issues. >> We're not at the HIMSS Conference Dave? >> We should be at HIMMS. So these are big issues for any organization in healthcare. It's just exacerbates the challenges on IT. So, I wonder if you can talk about some of the drivers in your business, compliance, and in new tech and maybe share with us some of the things that you're seeing. >> Absolutely so first and foremost, we are an Epic system shop. That's our EMR. So, from a enterprise and clinical operation, that is our number one mission critical application. It provides your electronic medical records to our staff, regardless of where they're physically located at. So that alone is a demanding type of solution if you will, the mobility aspect of it. Delivering that in a fast manner and a repeatable manner is upmost important to our physicians because they're actually seeing patients and getting to your records and being able to add notes and collaborate with other institutions if necessary. So, time to market is very important and accessibility is also up there. >> Right so, you mentioned that collaboration and part of that collaboration is so much data now, being able to harness that data and share it. Data explodes everywhere but in healthcare, there's so much data to the extent we start instrumenting things. What are you guys doing with all that data? >> Right now, it lives within the clinical application, right in Epic, but as you pointed out that is where the value is. that is where your crown jewels so to speak are at. That data is now being looked at as a possible access point outside of the clinical operation. So, it's environment is going to be even more important going forward, when you look to branch out into some of the basic sides in more of a research, to gain access to that clinical data. That historically has been problematic for the research to be done accessing that information. >> So, in the corporate we like to think of, from an IT perspective, you got to run the business, you got to grow the business, you got to transform the business. It's a little different in healthcare. You kind of got to comply. A lot of your time is spent on compliance and regulation changes and keeping up with that. And then there's got to be a fair amount that's at least attempting to do transformation and in kind of keeping up with the innovations. Maybe you could talk about that a little bit. >> Absolutely, particularly on the innovation side, we work closely with out partners at Epic and we work to decide roadmaps and how that fits into the Baylor world. Case in point, a year ago we were set to go to the new version of Epic, which was 2015. And Epic is nice enough to lay out requirements for you and say, here's what your system needs to meet in order to comply with Epic standards. So, they give you a seal of approval, so to speak. And there's monetary implications for not meeting those requirements. So it's actually dollars and cents. It's not just , we want you to meet this. If you do then there's advantages to meeting it. So, they provided that to us and went though the normal testing phases and evaluations of our current platform, both from compute and storage. And honestly we struggled to meet their requirements with our legacy systems. So the team was challenged to say well, what can we do to meet this? We have our historical infrastructures, so if we're going to deviate from that, let's really deviate and look at what's available to the market. So, Flash comes to mind immediately. So, there's a multitude of vendors that make Flash storage products. So we started meeting with all of 'em, doing our fact finding and our data gathering, meeting with all of 'em. First and foremost, they have to be Epic certified. That eliminated a couple of contenders right off the bat. Right? You're not certified. >> I would expect some of the startups especially. >> It did. Some of the smaller, Flash vendors, for example, one of 'em came in and we said, well, what do you do with Epic? And they said what's Epic. And you kind of scratch your head and say thank you. >> Thank you for playing. >> Here's the door. So, it eliminates people but then when we meet with PURE, and we talked to them and we meet 'em and you get to really know that the family and the culture that they bring with the technology. Yes it's got to be fast but Flash is going to be fast. What else can you do? And that's where you start learning about how it was born on Flash, how it was native to Flash and so you get added benefits to the infrastructure by looking at that type of technology, which ultimately led us there, where we're at running Epic on our Flash arrays. >> And Brian, you're using the Flash stack configuration of converge infrastructure. It sounds like it was PURE that lead you that way as opposed to Cisco? Could you maybe walk us through that? >> That's very interesting, so we're a UCS shop. We were before PURE. So when PURE came in, the fact that they had a validated design with the Flash stack infrastructure, made it all that more easier to implement the PURE solution because it just is modular enough to fit in with our current infrastructure. That made it very appealing that we didn't have to change or alter much. We just looked at the validated design that says, here's your reference architecture, how it applies to the Flash stack. You already have UCS. We love it, we're a big fan. And here's how to implement it. And it made the time to market, to get production work loads on it, very quick. >> And the CVD that you got from Cisco, that's Cisco plus PURE but was it healthcare Epic specific or was that the PURE had some knowledge for that that they pulled in? >> So, that was one of the value adds that we feel PURE brought was the Epic experience. And whether that's scripting, the backups, and if you're familiar with Epic, the environmental refreshes that they have to do. There's seven Epic environments. And they all have to refresh off of each other and play off of each other so, >> So you have a window that you have to hit right. >> And you do right? And historically that window's been quite large. And now, not so much which makes everybody happy. >> Hey, that's what weekends are for. >> Absolutely, yeah, our DBAs attest to that right? So, we would like to think we've made their world and life a little bit more enjoyable 'cause those weekends now, they're not having to babysit the Epic refreshes. Back to the point of Epic experience, that was instrumental in the decision makings from a support with the PURESTORAGE help desk, awareness of what it takes to run Epic on PURE, and then going forward knowing that there's a partnership behind Epic and PURE and certainly Baylor College of Medicine as we continue to look at the next versions of Epic, whether that's 2018 and on to 2020, whatever that decision is, we know that we have a solid foundation now to grow. >> And Brian I'm curious, you've been a Cisco shop for a while, Cisco has lots of partnerships as well as, they've got a hyper-converged offering that they sell themselves. What was your experience working with Cisco and do they just let you choose and you said, I want PURE and they're like, great? Do you know? What was that like? >> To your point, there's validated designs for many customers and Cisco is kind of at the hub of that, that core with the compute and memory of the blade systems, the UCS. They liked the fact that we went with PURE 'cause it does me a validated design. And they have others with other vendors. The challenge there is how do they really integrate with each other from tools to possibly automation down the road, and how do they truly integrate with each other. 'Cause we did bring in some of the other validated design architecture organizations and I think we did our due diligence and looked at 'em to see how they differentiate between each other. And ultimately, we wanted something that was new and different approach to storage. It wasn't just layering your legacy OS on a bunch of Flash drives and call it good. Something that was natively born to take advantage of that technology. And that's what ultimately led us to PURE. >> Well, PURE has a point of view on the so called hyper-converged space. You heard Scott Dietzen talking this morning. What's your perspective on hyper-convergence? >> Hyper-converge is one of those buzz words that I think gets thrown out of there kind of off the cuff if you will. But people hear it and get excited about it. But what type of workloads are you looking to take advantage of it? Is it truly hyper-converged or is it just something that you can say you're doing because it sounds cool? I think to some degree, people are led astray on the buzzwords of the technology where they get down to say, what's going to take advantage of it? What kind of application are you putting on it? If your application, in our case, can be written by a grad student 20 years ago that a lab is still using, it does it make sense to put it on hyper-converged? No, because it can't take advantage of the architecture or the design. So, in a lot of ways, we're waiting and seeing. And the reason we didn't go to a hyper-converged platform is a, Epic support and b, we were already changing enough to stay comfortable with the environment and knowing that come Monday morning, doctors will be seeing patients and we're already changing enough, that was another layer that we chose not to change. We went with a standard UCS configuration that everyone was already happy with. That made a significant difference from an operational perspective. >> Essentially, your processes are tightly tied to Epic and the workflow associated with that. So from an infrastructure perspective, it sounds like you just don't want it to be in the way. >> We don't. The last thing we want in infrastructure getting in the way. And quite frankly, it was in the way. Whether that was meeting latency requirements or IOPS requirements from the Cache database or the Clarity database within the Epic system, or if was just all of are just taking a little bit longer than they expect. We don't want to be that bottleneck, if you will, we want them to be able to see patients faster, run reports faster, gain access to that valuable data in a much faster way to enable them to go about their business and not have to worry about infrastructure. >> Brian, PURE said that they had, I believe it's like 25 new announcements made this morning, a lot of software features. Curious, is there anything that jumped out at you, that you've been waiting for and anything still on your to do list that you're hoping for PURE or PURE and it's extended ecosystem to deliver for you? >> Great question, so at the top of that list is the replication of the arrays, whether that's in an offsite data center or a colo and how that applies to an Epic environment that has to go through this flux of refreshes, and from a disaster or business continuity standpoint, we're actively pursuing that, and how that's going to fit with Baylor. So, we're very excited to see what our current investment, free of charge by the way, once you do the upgrade to 5.0, is to take advantage of those features, with replication being one of 'em. >> And then, I thought I heard today, Third Sight is a service. Right? So you don't have to install your own infrastructure. So, I'm not sure exactly what that's all about. I got to peel the onion on that one. >> To be determined right? When we look at things like that, particularly with Epic, we have to be careful because that is the HIPAA, PHI, that's your records, yours and mine, medical records right? You just don't want that, if I told you it's going to be hosted in a public cloud. Wait a minute. Where? No it's not. We don't want to be on the 10 o'clock news right? However, there's things like SAP HANA and other enterprise applications that we certainly could look at leveraging that technology. >> Excellent, we listen, thank you very much Brian for coming on theCUBE. We appreciate your perspectives and sort of educating us a little bit on your business and your industry anyway. And have a great rest of the show. >> Yeah, thank you very much. Appreciate it. >> You're welcome. Alright keep it right there everybody. This is theCUBE. We're back live right after this short break from PURE Accelerate 2017. Be right back.

>>live from San Francisco. It's the Q covering Micron Insight 2019 to You by Micron. >>Welcome back, everybody. We hear a Pier 27 in San Francisco. Beautiful day. David Floor is my co host on Day Volante, and this is Micron Inside. 2019. Jeff Baylor is here. He's the corporate vice president of the embedded business unit at Micron. Jeff, great to see you again. >>Thank you. Nice to be here >>so love to talk about autos. I o. T Edge. Use cases to talk about the focus of your team. Let's start there. Yeah, >>sure. So the embedded business to point. It's absolutely focused on the automotive industry's way. Call industrial markets. So factory automation, surveillance and stolen a swell as a consumer electronics businesses on we're really in across all those sort of focused on how connectivity and compute is changing inside of those. And, of course, how that drives memory. >>I mean, yeah, memory and storage. They hide in places that we use every day. You don't see them, but if they weren't there, you wouldn't be able to use all these devices. They wouldn't be as life changing as they are. So you know you mentioned some of the consumer stuff. You know what the big trends that are driving your business? Well, I do >>think it is absolutely. That's sort of the ubiquity of connectivity. First of all, and then, sort of the ubiquity of compute has enabled all of these what used to be sort of isolated applications to now be connected and doing a whole lot more analytics inside that machine. Do you think about intelligence in your thermostat on the wall? You think about intelligence, obviously, in the automotive business, where safety features and so on are using so much more electron ICs and a I machine learning. And that's happening really in every application, whether it's the smart speakers at home, voice control on your TV and so on and so forth. All of those drive more intelligence, more connectivity and then more memory and storage behind that. >>When people talk about automotive, of course, everybody wants to talk about autonomous vehicles. I love to talk about autonomous vehicles, but there's so much action going on in today's vehicles dozens and dozens of microprocessors throwing off all kinds of data. So give us the update on the automotive industry. >>Yeah, you're exactly right. I mean, autonomous gets the headlines and it will for several more years just be headlines more or less right? And the real story is what we call eight ass or advanced driver assistant system. So things like lane departure warning, lane departure, keeping things like auto emergency braking those those sort of much simpler, easier problems to solve are still very compute intensive on. So are driving a huge growth and electronics on memory of storage inside the car. The other major part of the car market in the automotive market is what we call infotainment, sort of the center console. More and more large screens going into that more high function capabilities being integrated in that whether it's navigation or streaming media service is and all of those air driving again a much richer mix that's required >>for those applications. I was at the arm conference and they were talking about automotive and some of the challenges, one of the most fascinating areas they were talking about. How do you make something that will last for 20 years in the car on make it such that if it does go wrong that it that it could recover seamless less. Can you talk about some of the technologies that >>are sort of two parts to that? Unpack a little bit? First through? What does it take to succeed in automotive? First of all, it's all about quality. Yeah, right. It is quality, quality, quality location, location, location. It's quality. It's it's reducing and eliminating defense fundamentally at the end of the day and so inside of our process. Design inside of our technology designed our product designs. Our product manufacturing flows are all designed to sort of fundamentally improve and continue to improve the quality level because at the end of the day, that is what what makes or breaks you in the car. As soon as you solve that, you know, small problem. Next problem is longevity and stability of that solution, because the design cycle itself is shortening and automotive. But it's a very long design cycle, and then the life cycle in automotive is still very, very long. I mean, the average car on the road in the U. S. Is 12 or 15 years old, right, and that needs to both continue to be viable but also often need toe continue shipping that product. It's gonna shipment volumes or have spares and replace. So So we have a strategy that sort of focused on both bringing those leading edge technologies that Micron has into automotive as soon as possible and that timeline is shrinking. But then also having a very long life manufacturing strategy to continue to provide those for so long. >>So you're certainly a leader in automotive. You might even be the leader. I'm not sure I have the data, but what is it you mentioned? You know, quality and those other factors. What is it that's allowing you to do so well in automotive? >>So So we are the beater for sure. We're about 40% market share, which is a little more than three times as big as the nearest competitors, right, So leader by far, really an automotive. And it's been a very long time that we're in this industry and very focused on. So it is. It is about the product mix and bringing in particular lately leading edge technology into that story. You know, we are at the very beginnings of LP five, the low power GDR five generation, where the very beginnings of that rolling out into mobile applications, its primary markets at the same time, almost literally the same time. Way air sampling and providing that into our automotive customers and our automotive partners to start beginning building their systems around L P. Five. So that time to adopt leading edge technology is rowing is shrinking very rapidly. And so we're able to provide that leading edge Tech started, coupled with that long life solution and then one of the areas, when you think about being in a 40% market share position, way air investing tremendously in sort of partnering with the customers around, essentially defining and driving the innovation that they need to deliver So way have a number of labs that we've established customer facing labs that were able to bring customers and even our customers customers. So the Auto am is directly into those labs to start looking at usage models and architectural sort of feasibility and optimization kinds of things that we could then plan into our road map to follow two or three years later. After that, >>a lot of domain expertise there, so tremendous I said the Derrick Dicker that Micron has a very large observation space. You sell to a lot of different channels and I want to ask you about industrial I ot David night. We spent a lot of time in the Enterprise and we see a lot of I t company saying, Hey, here's a box. We're gonna throw it over. We're gonna go dominate the edge anywhere you talkto operations, technology, professions there like No, we're talking about machines and equipment and it's like this whole different parlance and language. So what are you seeing? Just in terms of the ecosystem, how it's developing the sort of analog going to digital And that whole explosion? Yeah, >>again, Industrial is extremely broad market, and it means a 1,000,000,000 things toe people. Right? So So, one of the first things we have to do is sort of narrow the field a little bit, at least into specific verticals and specific areas. Way have the right product mix and opportunity, right? So, for example, in the in the space of factory automation, it's a little bit what you're just saying the operational technology guys are trying to figure out how they're gonna drive efficiency, drive productivity inside a factory on, and that is often a question of instrument ing, and putting in my crown is doing a lot of this sort of smart manufacturing deployment. Putting this sensor network multiple cameras, multiple high resolution cameras, audio sensors, accelerometers, sort of sensors and capturing all of that sensor data to Dr Things like better predictive maintenance, better sort of yield detection or excursion detection kind of capability. So you could tell this machine, you know, seven days, five days out of the week Sounds like this. But last night at 10 o'clock, it started sounding different way. Don't know what it means necessarily, but we can detect that. And that's where all of the A I and Machine Learning is now being applied to say. And that means it's due for a P M. About this particular portion of >>what about security at the edge, obviously a hot topic in the Enterprise on every C. I ose mind what's happening with security in Io ti industrial out in the edge. Yeah, I think >>to some extent, security in the I. O. T. I think is, is why I ot is where it is in the hype cycles. Maybe it's sort of still at the bottom of one of these types cycles, meaning solving that increasing security problem, that cyber security problem that the edge is really a big problem. You saw you know the hacks a few years back of the Jeep charity. You saw the hack two years back on surveillance cameras. All these cameras moving toe i p surveillance cameras means they're now connected and open to the world. Dispersed. He just announced last week in a report that basically showed I ot specific hacks up seven fold or seven fold this year after being up tenfold last year. So it's absolutely a growing problem for people thinking about deploying again. Connectivity is a great tool in a great weapon, Depending. And I was so so. One of my crown is doing is is way. >>Have a >>solution called authentic, which is essentially a cybersecurity, is a secure element built into the non volatile memory that goes in each one of these systems. So today, security is not a one chip problem. It is a full and and system problem. And so what we're tryingto build with that is the capability at a very sort of lowest level in the system right where the code is right where the four part of the system is to protect that in the memory itself and sort of a test that that is safe and secure. And then the system can build out about around that. And that sort of simple boot device, in the case of a nor device or Anand device is in every embedded application >>right in the world, >>right? I mean, you think about you go back a long way, Stuxnet. You know, 10 plus years ago with a seaman's controller, which was the and now you think about fast forward, how much Maur infrastructure is out there? How much more complicated it is, It's ah, it's a scary situation is Oh, it is so that we think that's a >>big opportunity. And we're making the announcement later, uh, later in the show today, on an extension of what we're doing already in that space. >>I know you're working with other vendors. People like >>me are worry with Yes, >>it is really >>an end to end. >>This is really an end to an an ecosystem >>activity, for sure, because again, arm is a great example. You know, all of the S o. C. Vendors. You know, everybody in this industry has some slice of the of the rules. Let's say to figure out how they're going to secure this system and we're tryingto build a basic building block that they can then build on >>that when we started this morning was really quiet. But the crowd is rolling in. Now there's a buzz that you can hear, hear. The key was excited to be here, Jeff. Thanks very much for coming on. The king here to see you again. >>Very much nicer here. >>All right. Keep it right to everybody. We're gonna be taking a short break. We'll be back. Day long coverage wall to Wall of Micron inside. 2019. You're watching the cube.

(energetic music) >> Announcer: Live from New Orleans, Louisiana, it's The Cube! Covering .NEXT conference, 2018, brought to you by Nutanix. >> Welcome back to The Cube's coverage here of Nutanix .NEXT 2018, I'm Stu Miniman with my co-host, Keith Townsend. Happy to welcome to the program two first time guests. We have Sherry Lautenbach who's the SVP of America Sales with Nutanix and Inder Sidhu who is the EVP of Global Customer Success, also with Nutanix. Sherry and Inder, thanks for joining us. >> Sherry: Thank you. >> Alright, so Sherry, first of all, you were up on stage this morning celebrating customers, we actually had the chance yesterday to nominate one of the, to interview one of the, nominees there and talked about what that meant to them and it was really talked about, you know, it's validation, where you know, we're trying something, we think we went out beyond what other people are doing and getting that validation back was just, they were really excited just to be nominated, so, you know, take us inside. >> Yeah, so first of all, we had hundreds of nominations, so it was super hard to choose and break it down to the finalists and then of course the winners, but for us, it was about innovation about cloud trailblazers, you know, dev ops, lots of different types of awards this year, and recognizing things that customers are doing to innovate with Nutanix. The best award we did have was Art.Heart give-back award and that, you know, it says a lot about our company that we focus on what companies are doing to better the communities they live in and the world in general, so. >> Yeah, and JetBlue is the winner there. >> Absolutely. >> Have to say, it makes me even happier to talk about, I have status with JetBlue, cause I fly to a lot of shows. >> Yeah, I can imagine Doug, they've been a great partner of ours, a great spokesperson, and they've really leveraged our technology to innovate with their company, so it's been a, it was a great morning. >> Alright, Inder, we watched Nutanix since the early days, discussion about NPS scores, and when you can't, when you come to an event like this, you can't help but feel the passion of the customers - over 5500 people here. Talk to us about what your role is, your engagement with customers, that whole customer success, and what that means. >> Yeah, customer success in my mind, Stu, is probably the single most important thing that we do at Nutanix, and the reason is because customers drive everything that the company does; it drives our employee behavior, it drives our partner behavior, it drives our product roadmaps. We're an outside-in company, fundamentally, and therefore, driving the customer success holistically, not just in terms of support after they might have an issue, but holistically, end-to-end over the entire life cycle is very very important for us. So, we're creating an organization, an investment, reporting all the way to the CEO to drive exactly that and we're very excited about that. >> Right, and I call it customer obsession, so I've been at Nutanix six months, the first day I showed up to headquarters, they gave me my laptop, and then they brought me up to the customer support area and said, "This is why we're so successful, because we are maniacally focused on ensuring our customers are being delivered value every day." And with a focus on our NPS four daily. So, for me, that was super impressive, and we don't let up on it. >> Stu: You know, Sherry, and I love some of the pieces. You were talking about innovation, talking about developers-- >> Sherry: Yes. >> We've been talking to a lot of customers about their digital transformation. It's not just, "Oh, okay, I'm re-platforming," it's more than that, talking about, what one of the customers said is, you know, "Business as IT." >> Right, no absolutely. So, digital transformation is clearly the buzzword, but it is all about what are companies doing to transform their businesses to become digital. And, Dheeraj always says, you know, "To be in that digital transformation journey is all about what you do to transform not only your IT operations, but the business." And the business drives what digital transformation does, absolutely. And it's not just creating things online or creating a presence, but its actually innovating yourself to differentiate yourself from your competition. We've seen that time and time again on what Amazon did to bookstores or what Netflix did to Blockbuster. And those types of things are the innovation that drives the change. >> Keith: So, Inder, speaking of innovation-- >> Inder: Mmhmm. >> Nutanix digitally transformed themselves into a software company. You guys made a lot of announcements, a lot of new products in the pipeline, a lot of new features available: GA as of the show. Nutanix has become a bigger company, valuation over nine billion dollars, as you get bigger, it's hard to keep that NPS score over 90. Where's the focus and how do you do it as Nutanix grows? >> You know one of the things, I think, as we become a big company in terms of size and scale, in terms of our heart and in terms of our spirit, we're very much a small company. I go tell customers, there is going to be times when we'll screw up. But you'll never find any company that's going to work harder than us to drive your success. And that's where the intent is, that's where the focus is. We're going to do whatever it takes from an holistic end-to-end customer perspective. We're assigning customer success managers to some of our largest customers so we can proactively engage with them, especially along three dimensions. We're not like a lot of other technology companies, where you just try to sell them technology, we're around three things: we want to make sure make sure that our customers can be organizationally proficient, we want to make sure they're operationally efficient and we want to make sure that they're financially accountable. All three of those dimensions have to do with stuff that's important to them. As we make them successful along those dimensions, automatically the technology starts to get adopted and they start seeing some benefits. >> So, Sherry, let's talk about that customer success manager. What are they empowered to do, like, if there's a problem, how do they make it right? >> Well that's a great question, they're empowered to do whatever it takes on behalf of the customer to ensure that one, they're deploying our technology well and they're finding great value in it. It's interesting, I've spoken to many customers at this conference and so many of them have said, you know, using Nutanix has changed my career, my career trajectory, and the business value I provide the organization, not just from an IT standpoint, but on the business side. And so for me, there's no greater compliment when our customers, they're cheering for us, they're rooting for us cause we're helping to transform what they do every day. So the customer success manager is just going to be an overlap in terms of ensuring and driving that success as we get deeper and deeper into these customers. >> And what we're going to do is we're going to start out with customer success managers more at the top of the pyramid, some of the largest accounts, but remember, we still have hundreds and hundreds of account team members from Sherry's team and others; SEs, all of whom provide an even greater leverage, and then extending all the way through our partners. So we have a high-touch model at the top with CSMs, we have a medium-touch model with SEs and account teams and insight sales reps and partners in the middle, and on the bottom of the pyramid, we've got a tech-touch model, where we're going to actually leverage our technology with self-service portals and so on with emails and webinars and training and material that can actually drive their end-to-end success, very focused on that. >> Stu: Sherry, I'm wondering if you can dig in some of the organizational pieces that Inder was talking about. From your customers as you move up the food chain with the products, what are you hearing from your various constituencies inside of companies? >> Inside of our customers? >> Stu: Inside of the customers, yes. >> Right, so, well we cover, in terms of an organizational size, we cover all different types of customers in various ways. We have dedicated account people to our largest accounts alongside with SEs of course. And we leverage our partners, though, in our channel and everything we do, so they're considered an extension of our sales force, which I think is truly valuable and really important that we ensure that they drive success with our customers. >> Anything special you're hearing when you get up to the C-Suite, pain points, that they're hearing more than you heard in the architect or admin standpoint? >> Yeah, no, they're looking for more of, you know, helping to rationalize cloud: how do I get to cloud, what's the right balance in terms of hybrid, on-prem, off-prem, and really, understanding the business value and drivers around it, not just cost efficiency. It's about transforming different areas of their business and many of the C-Suite customers that I speak to really are approaching it many different ways, dependent on what is the key pain point and business problem they're trying to solve. >> Inder: So, two things I'd say to add to Sherry's answer there is that what we see is customers wanting to engage more architecturally rather than an individual point product through a consultative process that is more around business outcomes. So it's not something necessarily new, but it's a little bit new for Nutanix, cause we've historically engaged at the technology level, and now you're finding more and more. Of the Fortune 50, we have 33. Of the Fortune 100, we have 66. So we're actually starting to get to really large customers in a big way. They want a deeper, architectural, all-in engagement, and as our portfolio starts to expand from just HCI to Flow and Beam and Xi and all of those, they're saying gosh, I mean I just literally ran into a CIO in the elevator, coming down this morning, and he said gosh, we were thinking about doing NSX but now that I came here and I heard about Flow and I heard about Xi, I think I'm going to go all-in with you guys, I'm going to put that thing on ice, and really work with you guys on this. Literally, unsolicited, in the elevator, this morning. >> Keith: That's impressive. So as we, on all those lines of growth, you guys have a huge user community: 70,000 participants, and this morning, Dr. Brennan, I'm sorry, Dr. Brené Brown talked about having difficult conversations around diversity. I want to first give you guys kudos, this is from an optics perspective been one of the most diverse technology conferences I've attended from an entertainment to the onstage presence to the keynote speakers, awesome job. As you guys are working towards having a more diverse user set, how are you helping your user community be successful along with their careers from a diversity perspective and whereas a career development perspective. >> Great question, and yes, I'm super proud of the diversity, things we're doing in the company. Just yesterday, I hosted a women's IT luncheon, so we celebrated the women around Nutanix so that was all about building a network of all of our customers: female and male, they were included too in this luncheon. And we had over 130 people, spent time, I said let's exchange business cards, let's talk about some of the challenges you face. We had one of our board members, Sue Bostrom share some very personal stories about challenges she's faced and opportunities to help advance her career, gave a great perspective on that. We also had the CEO of FlyWheel, she talked about failing fast and pivoting, and that to me was great little lessons and tidbits that we can provide our customers to say let's empower you to be even better and to build your network even more effectively. >> And if I can add to that, I think, what we're always looking for is a diversity of ideas, and those diversity of ideas is not just a nice-to-have, it's a must-have because it actually drives positive business outcomes from us when we start to represent what our community of users and what our community of customers is. And that diversity of ideas comes from people who have had a diversity of backgrounds, across a wide range of dimensions of diversity, and that's what we're really looking for. We're not necessarily solving for outcomes, we want to solve for opportunity, and make sure that everybody has that equal opportunity to engage and participate, and the more we do that, the richer we get, the more powerful we get, the more alive we become, I think, with diversity. >> Right, I mean, you think about that, you know, our traditional influencer was in the data center side, but we've found now in terms of diversity of our portfolio, the developer is going to be just as important of an influencer for Nutanix, so we're looking at it from not only our customers and who but what they do. >> Stu: Inder, I was wondering if you could get some colla rosso on the vertical side of things, we know you started early very much in the public sector phase, had a lot of strength there, so speak to how else you're growing in the vertical space. >> Inder: Yeah, one of the things we're doing is as we get into bigger and larger customers, as you know, we have 9000 customers, adding a thousand every quarter, we have about 642 after global 2000 customers and so, as we get into those, those customers want us to be able to talk to them in their language, around their issue. So I'll give you a great example, you know, recently, we hired a guy, his name is Don Mims out of Baylor Scott & White as a Customer Success Manager. Here's a guy who's done everything the Nutanix products, implemented them all through Baylor Scott & White, 7000 beds, 48 hospitals, and here's a guy who's implemented Nutanix, he's implemented AHV, he's implemented Epic. I got 40 other customers in the US alone who want to implement Epic and AHV in the healthcare sector among the provider community, and we're going to go towards those customers with that kind of verticalized expertise. Same thing around financial services, same thing around retail. I mean, when you look at retail, Walmart, Home Depot, Tractor Supply Company, Nordstrom, Target, you know, Best Buy, Kohls, we've got a wide range of customers who give us insight into their operations, and when we engage with them, when you're talking to a retailer, you're talking about dollars per square foot, you're talking about same store sales, you're talking about a flexible workforce and then you translate that into IT, which translates into a hybrid public-private flexible infrastructure. So as we have these conversations, they're very engaging, and we are starting to verticalize if you will, in terms of our overlay expertise. Sales force of course is going to be geographic first, because of the proximity that's required, but we're going to have overlay both in the services and in the sales organization that's going to be very noticeable as well. >> And we have found that there are certain geographies and areas that we can verticalize in the field, so, for example, Tennessee or in California, we can build healthcare verticals which has been very effective cause customers want us to talk in their language, understand what critical business applications they can leverage with Nutanix. So we're trying to mirror, as best we can, the vertical point of view in the field. >> Public sector of course is the first vertical that gets carved out for many companies, service providers, the second, we've already got public sector carved out, and one of the things, great kudos to Sherry and her team, you were proactive, Sherry, with Brad Rhodes in kind of carving out healthcare as a dedicated sales region in the West where people have nowhere to hide, you just live and die by the healthcare success, customer success. >> Well, and also, the familiarity on the use cases, right, cause a lot of the use cases are repeatable, so it just makes a lot of sense for us to bring teams together that can go to market that way. >> Keith: So, let's talk about the speed of Nutanix. I love the story, the impromptu meeting, CIO in an elevator, you guys are wowing me with the technologies in ways I never thought of. Let's talk about the other end of it. Where are customers pushing you, saying, "You know what, you guys need to move faster." You have one customer that's on NSX, you have a bunch that are looking way past that. >> Sherry: Right, no that's a great question, and the great thing about Nutanix is we really don't say no a lot, I mean, we've got to be very thoughtful in what we sign up for, but we will innovate and collaborate with customers in every instance. So what is it that you need, you need a support on a platform? We'll give you the right timeframe to do it, but yeah, we're going to do what we can to deliver on that, so, there is a lot that's coming at us from a speed standpoint with our customers and the demands that they have but I think that's a testament to the adoption and the delight that they have of using Nutanix and wanting to expand that in their enterprise. >> Inder: And I think, to some extent, Keith, I think your question is more about where are we perhaps falling short a little bit, and I'll tell you one area where perhaps we could do better, which is for support of a wider array of platforms. So for example, when we go to Asia Pacific, a lot of our customers are telling us, gosh you got support for Dell or Lenovo or IBM, etc., but what about other platforms that are local, Hitachi or Fujitsu or Inspira or Avia, etc.? So we're going to get very disciplined and structured around it, we don't want to over commit and let anybody down, because extending support to multiple platforms is not trivial, but we want to make sure that when we commit, we say what we'll do and we do what we say. And that's a guarantee that we'd like to provide to our customers. >> Stu: Inder and Sherry, I want to give you both an opportunity: just final takeaways you want your customers to know about Nutanix as they leave the show this year. >> Well, we'd love for more customers to come onboard, one thing I've seen with our customers that are here is that they love our technology, they're delighted. We've helped change jobs and careers with many of our customers and for me that's a huge privilege. >> I'd just say that customer success is the single most important thing for us, for our customers, we might make a mistake every once in a while, but you will never find anybody who works harder on your behalf. We've got the energy, we've got the fire in the belly, we've got the agility, and we're going to do everything that it takes to make you successful, no matter what. Period, end of story. So we're all in, we hope you can be all in with us as well. >> Alright, Inder and Sherry, obviously the passion is here from you, from your customers and the team. Thanks so much for joining us today. For Keith Townsend, I'm Stu Miniman, lots more coverage here coming from Nutanix.NEXT, New Orleans, 2018. Thanks for watching The Cube. >> Thank you. (electronic music)

>> live from the Congress Centre in London, England. It's the queue at M I t. And the digital economy. The second machine Age Brought to you by headlines sponsor M I T. >> Everybody, welcome to London. This is Dave along with student men. And this is the cube. The cube goes out, we go to the events. We extract the signal from the noise. We're very pleased to be in London, the scene of the first machine age. But we're here to talk about the second Machine age. Andrew McAfee and Erik Brynjolfsson. Gentlemen, first of all, congratulations on this fantastic book. It's been getting great acclaim. So it's a wonderful book if you haven't read it. Ah, Andrew, Maybe you could hold it up for our audience here, the second machine age >> and Dave to start off thanks to you for being able to pronounce both of our names correctly, that's just about unprecedented. In the history of this, >> I can probably even spell them. Whoa, Don't. So, anyway, welcome. We appreciate you guys coming on and appreciate the opportunity to talk about the book. So if you want to start with you, so why London? I mean, I talked about the first machine age. Why are we back here? One of the >> things we learned when we were writing the book is how big deal technological progress is on the way you learn that is by going back and looking at a lot of history and trying to understand what bet the curve of human history. If we look at how advanced our civilizations are, if we look at how many people there are in the world, if we look at GDP per capita around the world, amazingly enough, we have that data going back hundreds, sometimes thousands of years. And no matter what data you're looking at, you get the same story, which is that nothing happened until the Industrial Revolution. So for us, the start of the first machine machine age for us, it's a real thrill to come to London to come to the UK, which was the birthplace of the Industrial Revolution. The first machine age to talk about the second. >> So, Eric, I wonder if you could have with two sort of main vectors that you take away from the book won is that you know, machines have always replaced humans and maybe doing so at a different rate of these days. But the other is the potential of continued innovation, even though many people say Moore's law is dead. You guys have come up with sort of premises to how innovation will continue to double. So boil it down for the lay person. What should we think about? Well, sure. >> I mean, let me just elaborate on what you just said. Technology's always been destroying jobs, but it's also always been creating jobs, you know, A couple centuries ago, ninety percent of Americans worked in agriculture on farms in nineteen hundred is down to about forty one percent. Now is less than two percent. All those people didn't simply become unemployed. Instead, new industries were invented by Henry Ford, Steve Jobs, Bill Gates. Lots of other people and people got rather unemployed, became redeployed. One of the concerns is is, Are we doing that fast enough? This time around, we see a lot of bounty being created by technology. Global poverty rates are falling. Record wealth in the United States record GDP per person. But not everyone's participating in that. Not even when sharing the past ten fifteen years, we've actually to our surprise seem median income fall that's income of the person the fiftieth percentile, even though the overall pie is getting bigger. And one of the reasons that we created the initiative on the digital economy was to try to crack that, not understand what exactly is going on? How is technology behaving differently this time around in earlier eras and part that has to do with some of the unique characteristics of eventual goods? >> Well, your point in the book is that normally median income tracks productivity, and it's it's not this time around. Should we be concerned about that? >> I think we should be concerned about it. That's different than trying to stop for halt course of technology. That's absolutely not something you >> should >> be more concerned about. That way, Neto let >> technology move ahead. We need to let the innovation happen, and if we are concerned about some of the side effects or some of the consequences of that fine, let's deal with those. You bring up what I think is the one of most important side effects to have our eye on, which is exactly as you say when we look back for a long time, the average worker was taking home more pay, a higher standard of living decade after decade as their productivity improved. To the point that we started to think about that as an economic law, your compensation is your marginal productivity fantastic what we've noticed over the past couple of decades, and I don't think it's a coincidence that we've noticed this, as the computer age has accelerated, is that there's been a decoupling. The productivity continues to go up, but the wage that average income has stagnated. Dealing with that is one of our big challenges. >> So what you tell your students become a superstar? I mean, not everybody could become a superstar. Well, our students cats, you know, maybe the thing you know they're all aspired to write. >> A lot of people focus on the way that technology has helped superstars reach global audiences. You know, I had one student. He wrote an app, and about two or three weeks, he tells me, and within a few months he had reached a million people with that app. That's something that probably would have been impossible a couple of decades ago. But he was able to do that because he built it on top of the Facebook platform, which is on top of the Internet and a lot of other innovations that came before. So in some ways it's never been easier to become a superstar and to reach literally not just millions, but even billions of people. But that's not the only successful path in the second machine age. There's also other categories where machines just aren't very good. Yet one of the ones that comes to mind is interpersonal skills, whether that's coaching or underst picking up on other cues from people nurturing people carrying for people. And there are a whole set of professions around those categories as well. You don't have to have some superstar programmer to be successful in those categories, and there are millions of jobs that are needed in those categories for to take care of other P people. So I think there's gonna be a lot of ways to be successful in the second machine age, >> so I think >> that's really important because one take away that I don't like from people who've looked at our work is that only the amazing entrepreneurs or the people with one forty plus IQ's are going to be successful in the second machine age. That's it's just not correct. As Eric says, the ability to negotiate the ability Teo be empathetic to somebody, the ability to care for somebody machines they're lousy of thes. They remain really important things to do. They remain economically valuable things >> love concern that they won't remain louse. If I'm a you know, student listening, you said in your book, Self driving cars, You know, decade ago, even five years ago so it can happen. So how do we predict with computers Will and won't be good at We >> basically don't. Our track record in doing that is actually fairly lousy. The mantra that I've learned is that objects in the future are closer than they appear on the stuff that seem like complete SciFi. You're never goingto happen keeps on happening now. That said, I am still going to be blown away the first time I see a computer written novel that that that works, that that I find compelling, that that seems like a very human skill. But we are starting to see technologies that are good at recognizing human emotions that can compose music that can do art paintings that I find pretty compelling. So never say never is another. >> I mean right, right. If if I look some of the examples lately, you know, basic news computers could do that really well. IBM, you know, the lots of machine can make recipes that we would have never thought of. Very things would be creative. And Ian, the technology space, you know, you know, a decade ago computer science is where you tell everybody to go into today is data scientists still like a hot opportunity for people to go in And the technology space? Where, where is there some good opportunity? >> Or whether or not that's what the job title on the business card is that going to be hot being a numerous person being ableto work with large amounts of data input, particular being able to work with huge amounts of data in a digital environment in a computer that skills not going anywhere >> you could think of jobs in three categories is ready to technology. They're ones that air substitutes racing against machine. They're ones that air compliments that are using technology under ones that just aren't really affected yet by technology. The first category you definitely want to stay away from. You know, a lot of routine information processing work. Those were things machines could do well, >> prepare yourself as a job. Is that for a job as a payroll clerk? There's a really bad wait. >> See that those jobs were disappearing, both in terms of the numbers of employment and the wages that they get. The second category jobs. That compliment data scientist is a great example of that or somebody who's AP Writer or YouTube. Those are things that technology makes your skills more and more valuable. And there's this huge middle category. We talked earlier about interpersonal skills, a lot of physical task. Still, where machines just really can't touch them too much. Those are also categories that so far hell >> no, I didnt know it like middle >> school football, Coach is a job. It's going to be around a human job. It's going to be around for a long time to come because I have not seen the piece of technology that can inspire a group of twelve or thirteen year olds to go out there and play together as a team. Now Erik has actually been a middle school football coach, and he actually used a lot of technology to help him get good at that job, to the point where you are pretty successful. Middle school football coach >> way want a lot of teams games, and part of it was way could learn from technology. We were able to break down films in ways that people never could've previously at the middle school level. His technology's made a lot of things much cheaper. Now then we're available. >> So it was learning to be competitive versus learning how to teach kids to play football. Is that right? Or was a bit? Well, actually, >> one of the most important things and being a coach is that interpersonal connection is one thing I liked the most about it, and that's something I think no robot could do. What I think it be a long, long time. If ever that inspiring halftime speech could be given by a robot >> on getting Eric Gipper bring the Olsen Well, the to me, the more, most interesting examples I didn't realise this until I read your book, is that the best chess player in the world is not a computer, it's a computer and a human. That's what those to me. It seemed to be the greatest opportunities for innovative way. Call a >> racing with machines, and we want to emphasize that that's what people should be focusing. I think there's been a lot of attention on how machines can replace humans. But the bigger opportunities how humans and machines could work together to do things they could never have been done before in games like chess. We see that possibility. But even more, interestingly, is when they're making new discoveries in neuroscience or new kinds of business models like Uber and others, where we are seeing value creation in ways that was just not possible >> previously, and that chess example is going to spill over into the rest of the economy very, very quickly. I think about medicine and medical diagnosis. I believe that work needs to be a huge amount, more digital automated than it is today. I want Dr Watson as my primary care physician, but I do think that the real opportunities we're going to be to combine digital diagnosis, digital pattern recognition with the union skills and abilities of the human doctor. Let's bring those two skill sets together >> well, the Staton your book is. It would take a physician one hundred sixty hours a week to stay on top of reading, to stay on top of all the new That's publication. That's the >> estimate. And but there's no amount of time that watching could learn how to do that empathy that requires to communicate that and learn from a patient so that humans and machines have complementary skills. The machines are strong in some categories of humans and others, and that's why a team of humans and computers could be so >> That's the killer. Since >> the book came out, we found another great example related to automation and medicine in science. There's a really clever experiment that the IBM Watson team did with team out of Baylor. They fed the technology a couple hundred thousand papers related to one area of gene expression and proteins. And they said, Why don't you predict what the next molecules all we should look at to get this tart to get this desired response out on the computer said Okay, we think these nine are the next ones that are going to be good candidates. What they did that was so clever they only gave the computer papers that had been published through two thousand three. So then we have twelve years to see if those hypotheses turned out to be correct. Computer was batting about seven hundred, so people say, didn't that technology could never be creative. I think coming up with a a good scientific hypothesis is an example of creative work. Let's make that work a lot more digital as well. >> So, you know, I got a question from the crowd here. Thie First Industrial Revolution really helped build up a lot of the cities. The question is, with the speed and reach of the Internet and everything, is this really going to help distribute the population? Maur. What? The digital economy? I don't I don't think so. I don't think we want to come to cities, not just because it's the only waited to communicate with somebody we actually want to be >> face to face with them. We want to hang out with urbanization is a really, really powerful trend. Even as our technologies have gotten more powerful. I don't think that's going to revert, but I do think that if you if you want to get away from the city, at least for a period of time and go contemplate and be out in the world. You can now do that and not >> lose touch. You know, the social undistributed workforce isn't gonna drive that away. It's It's a real phenomenon, but it's not going to >> mean that cities were going >> to be popular. Well, the cities have two unique abilities. One is the entertainment. If you'd like to socialize with people in a face to face way most of the time, although people do it online as well, the other is that there's still a lot of types of communication that are best done in person. And, in fact, real estate value suggests that being able to be close toe other experts in your field. Whether it's in Silicon Valley, Hollywood, Wall Street is still a valuable asset. Eric and I >> travel a ton not always together. We could get a lot of our work done via email on via digital tools. When it comes time to actually get together and think about the next article or the next book, we need to be in the same room with the white bored doing it. Old school >> want to come back to the roots of innovation. Moore's law is Gordon Mohr put forth fiftieth anniversary next week, and it's it's It's coming to an end in terms of that actually has ended in terms of the way it's doubling every eighteen months, but looks like we still have some runway. But you know, experts can predict and you guys made it a point you book People always underestimate, you know, human's ability to do the things that people think they can't do. But the rial innovation is coming from this notion of combinatorial technologies. That's where we're going to see that continued exponential growth. What gives you confidence that that >> curve will continue? If you look at innovation as the work, not of coming up with some brand new Eureka, but as putting together existing building blocks in a new and powerful way, Then you should get really optimistic because the number of building blocks out there in the world is only going up with iPhones and sensors and banned weapon and all these different new tools and the ability to tap into more brains around the world to allow more people to try to do that recombination. That ability is only increasing as well. I'm massively optimistic about innovation, >> yet that's a fundamental break from the common attitude. We hear that we're using up all the low hanging fruit, that innovation. There's some fixed stock of it, and first we get the easy innovations, and then it gets harder and harder to innovate. We fundamentally disagree with that. You, in fact, every innovation we create creates more and more building blocks for additional innovations. And if you look historically, most of the breakthroughs have been achieved by combining previously existing innovations. So that makes me optimistic that we'LL have more and more of those building blocks going >> forward. People say that we've we've wrung all of the benefit out of the internal combustion engine, for example, and it's all just rounding error. For here. Know a completely autonomous car is not rounding error. That's the new thing that's going to change. Our lives is going to change our cities is going to change our supply chains, and it's making a new, entirely new use case out of that internal combustion. >> So you used the example of ways in the book, Really, you know, their software, obviously was involved, but it really was sensors and it was social media. And we're mobile phones and networks, just these combinations of technologies for innovation, >> none of which was an invention of the Ways team, none of which was original. Theyjust put those elements together in a really powerful way. >> So that's I mean, the value of ways isn't over. So we're just scratching the surface, and we could talk about sort of what you guys expect. Going forward. I know it's hard to predict well, another >> really important thing about wages in addition to the wake and combined and recombined existing components. It's available for free on my phone, and GPS would've cost hundreds of dollars a few years ago, and it wouldn't have been nearly as good at ways. And in a decade before that, it would have been infinitely expensive. You couldn't get it at any price, and this is a really important phenomenon. The digital economy that is underappreciated is that so much of what we get is now available at zero cost. Our GDP measures are all the goods and services they're bought and sold. If they have zero price, they show up is a zero in GDP. >> Wikipedia, right? Wikipedia, but that just wait here overvalue ways. Yeah, it doesn't. That >> doesn't mean zero value. It's still quite valuable to us. And more and more. I think our metrics are not capturing the real essence of the digital economy. One of the things we're doing at the Initiative initiative, the addition on the usual economy is to understand better what the right metrics will be for seeing this kind of growth. >> And I want to talk about that in the context of what you just said. The competitiveness. So if I get a piece of fruit disappears Smythe Digital economy, it's different. I wonder if you could explain that, >> and one of the ways it's different will use waze is an example here again, is network effects become really, really powerful? So ways gets more valuable to me? The more other ways er's there are out there in the world, they provide more traffic information that let me know where the potholes and the construction are. So network effects lead to really kind of different competitive dynamics. They tend to lead toward more winner, take all situations. They tend to lead toward things that look more not like monopolies, and that tends to freak some people out. I'm a little more home about that because one of the things we also know from observing the high tech industries is that today's near monopolist is yesterday's also ran. We just see that over and over because complacency and inertia are so deadly, there's always some some disruptor coming up, even in the high tech industries to make the incumbents nervous. >> Right? Open source. >> We'LL open source And that's a perfect example of how some of the characteristics of goods in the digital economy are fundamentally different from earlier eras and microeconomics. We talk about rival and excludable goods, and that's what you need for a competitive equilibrium. Digital goods, our non rival and non excludable. You go back to your micro economics textbook for more detail in that, but in essence, what it means is that these goods could be freely coffee at almost zero cost. Each copy is a perfect replica of the original that could be transmitted anywhere on the planet almost instantaneously, and that leads to a very different kind of economics that what we had for the previous few hundred years, >> or you don't work to quantify that. Does that sort of Yeah, wave wanted >> Find the effect on the economy more broadly. But there's also a very profound effects on business and the kind of business models that work. You know, you mentioned open source as an example. There are platform economics, Marshall Banal Stein. One of the experts in the field, is speaking here today about that. Maybe we get a chance to talk about it later. You can sometimes make a lot of money by giving stuff away for free and gaining from complimentary goods. These are things that >> way started. Yeah, Well, there you go. Well, that would be working for you could only do that for a little >> while. You'll like you're a drug dealer. You could do that for a little while. And then you get people addicted many. You start charging them a lot. There's a really different business model in the second machine age, which is just give stuff away for free. You can make enough off other ancillary streams like advertising to have a large, very, very successful business. >> Okay, I wonder if we could sort of, uh, two things I want first I want to talk about the constraints. What is the constraints to taking advantage of that? That innovation curve in the next day? >> Well, that's a great question, and less and less of the constraint is technological. More and more of the constraint is our ability as individuals to cope with change and said There's a race between technology and education, and an even more profound constraint is the ability of our organisations in our culture to adapt. We really see that it's a bottleneck. And at the MIT Sloan School, we're very much focused on trying to relieve those constraints. We've got some brilliant technologists that are inventing the future on the technology side, but we've got to keep up with our business. Models are economic systems, and that's not happening fast enough. >> So let's think about where the technology's aren't in. The constraints aren't and are. As Eric says, access to technology is vanishing as a constraint. Access to capital is vanishing as a constraint, at least a demonstrator to start showing that you've got a good idea because of the cloud. Because of Moore's law and a small team or alone innovator can demonstrate the power of their idea and then ramp it up. So those air really vanishing constraints are mindset, constraints, our institutional constraints. And unfortunately, increasingly, I believe regulatory constraints. Our colleague Larry Lessing has a great way to phrase the choice, he says, With our policies, with our regulations, we can protect the future from the past, or we could protect the past from the future. That choice is really, really write. The future is a better place. Let's protect that from the incumbents in the inertia. >> So that leads us to sort of some of the proposals that you guys made in terms of how we can approach this. Good news is, capitalism is not something that you're you're you're you're very much in favor of, you know, attacking no poulet bureau, I think, was your comments on DH some of the other things? Actually, I found pretty practical, although not not likely, but practical things, right? Yes, but but still, you know, feasible certainly, certainly, certainly intellectually. But what have you seen in terms of the reaction to your proposals? And do you have any once that the public policy will begin to shape in a way that wages >> conference that the conversation is shifting. So just from the publication date now we've noticed there's a lot more willingness to engage with these ideas with the ideas that tech progress is racing ahead but leaving some people behind in more people behind in an economic sense over time. So we've talked to politicians. We've talked to policy makers. We've talked to faint thanks. That conversation is progressing. And if we want to change our our government, you want to change our policies. I think it has to start with changing the conversation. It's a bottom out phenomenon >> and is exactly right. And that's really one of the key things that we learned, you know well, we talked to our political science friends. They remind us that in American other democracies, leaders are really followers on. They follow public opinion and the people are the leaders. So we're not going to be able to get changes in our policies until we change the old broad conversation. We get people recognizing the issues they're underway here, and I wouldn't be too quick to dismiss some of these bigger changes we describe as possible the book. I mean, historically, there've been some huge changes the cost of the mass public education was a pretty radical idea when it was introduced. The concept of Social Security were recently the concept of marriage. Equality with something I think people wouldn't have imagined maybe a decade or two ago so you could have some big changes in the political conversation. It starts with what the people want, and ultimately the leaders will follow. >> It's easy to get dismayed about the logjam in Washington, and I get dismayed once in a while. But I think back a decade ago, if somebody had told me that gay marriage and legal marijuana would be pretty widespread in America, I would have laughed in their face. And, you know, I'm straight and I don't smoke dope. I think these were both fantastic developments, and they came because the conversation shifted. Not not because we had a gay pot smoker in the white. >> Gentlemen, Listen, thank you very much. First of all, for running this great book, well, even I got one last question. So I understand you guys were working on your topic for you next, but can you give us a little bit of, uh, some thoughts as to what you're thinking. What do we do? We tip the hand. Well, sure, I think that >> it's no no mystery that we teach in a business school. And we spent a lot of time interacting with business leaders. And as we've mentioned in the discussion here, there have been some huge changes in the kind of business models that are successful in the second machine age. We want to elaborate on those describe nuts what were seeing when we talk to business leaders but also with the economic theory says about what will and what? What won't work. >> So second machine age was our attempt it like a big idea book. Let's write the Business guide to the Second Machine Age. >> Excellent. First of all, the book is a big idea. A lot of big ideas in the book, with excellent examples and some prescription, I think, for moving forward. So thank you for writing that book. And congratulations on its success. Really appreciate you guys coming in the Cube. Good luck today and we look forward to talking to in the future. Thanks for having been a real pleasure. Keep right. Everybody will be right back. We're live from London. This is M I t E. This is the cube right back